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Why Do Different Countries Choose a Different Public-Private Mix of Educational Services?

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  • Estelle James

Abstract

We observe a wide range across countries in the percentage of total enrollments that attend private rather than public schools. This paper seeks to explain 1) the systematically higher proportion of private enrollments (%PVT) in developing as compared with developed countries at the secondary level, and 2) the seemingly random variation across countries within a given level of education and stage of development. I argue that the latter is due to differentiated demand and nonprofit supply, both of which stem from cultural heterogeneity, especially religious heterogeneity. In contrast, the large%PVT at the secondary level in developing countries is hypothesized to stem from limited public spending, which creates an "excess demand" from people who would prefer to use the public schools but are involuntarily excluded and pushed into the private sector. The limited public spending on secondary education, in turn, is modelled as a collective decision which is strongly influenced by the many families who opt for quantity over quality of children, in developing countries. The results of regressions that determine private sector size recursively and simultaneously with public educational spending are consistent with these hypotheses.

Suggested Citation

  • Estelle James, 1993. "Why Do Different Countries Choose a Different Public-Private Mix of Educational Services?," Journal of Human Resources, University of Wisconsin Press, vol. 28(3), pages 571-592.
  • Handle: RePEc:uwp:jhriss:v:28:y:1993:i:3:p:571-592
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    Cited by:

    1. Joshua Angrist & Eric Bettinger & Erik Bloom & Elizabeth King & Michael Kremer, 2002. "Vouchers for Private Schooling in Colombia: Evidence from a Randomized Natural Experiment," American Economic Review, American Economic Association, pages 1535-1558.
    2. Orazem, Peter, 2007. "Lack of Education," Staff General Research Papers Archive 12671, Iowa State University, Department of Economics.
    3. Orazem, Peter F. & King, Elizabeth M., 2008. "Schooling in Developing Countries: The Roles of Supply, Demand and Government Policy," Handbook of Development Economics, Elsevier.
    4. Orazem, Peter & Glewwe, Paul & Patrinos, Harry, 2007. "The Benefits and Costs of Alternative Strategies to Improve Educational Outcomes," Staff General Research Papers Archive 12853, Iowa State University, Department of Economics.
    5. Bowman Woods, 2011. "The Importance of Corporation Law to Civil Society," Nonprofit Policy Forum, De Gruyter, vol. 2(1), pages 1-17, May.
    6. Cinnirella, Francesco & Schueler, Ruth M., 2016. "Nation Building: The Role of Central Spending in Education," CEPR Discussion Papers 11621, C.E.P.R. Discussion Papers.
    7. World Bank, 2001. "Education and Training in Madagascar : Towards a Policy Agenda for Economic Growth and Poverty Reduction, Volume 2. Main Report," World Bank Other Operational Studies 15514, The World Bank.
    8. Alejandra Mizala & Pilar Romaguera, 2001. "La legislación laboral y el mercado del trabajo en Chile: 1975-2000," Documentos de Trabajo 114, Centro de Economía Aplicada, Universidad de Chile.
    9. Douglas J. Lamdin, 2001. "Can P.S. 27 Turn A Profit? Provision Of Public Education By For-Profit Suppliers," Contemporary Economic Policy, Western Economic Association International, vol. 19(3), pages 280-290, July.
    10. Santos, Humberto & Elacqua, Gregory, 2016. "Socioeconomic school segregation in Chile: parental choice and a theoretical counterfactual analysis," Revista CEPAL, Naciones Unidas Comisión Económica para América Latina y el Caribe (CEPAL).
    11. Gradstein, Mark & Justman, Moshe, 2001. "Public Education and the Melting Pot," CEPR Discussion Papers 2924, C.E.P.R. Discussion Papers.

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